_{Brought to you by:}

Howdy!

This is the 100th edition of Lightspeed. What a milestone. To put that in perspective, Steinbeck never wrote 100 novels, The Beatles never created 100 albums, and Joey Chestnut never ate 100 hot dogs in a 10-minute span. 

Yet here we are, crossing the 100 edition threshold, and we have absolutely no intention of slowing down. To celebrate, why don’t you go ahead and forward this email to a friend who might enjoy the newsletter?

One in four 2022 Solana VC startups have already failed

Never ask a man his salary, a woman her age, or a crypto VC about their 2022 Solana investments.

A pair of research notes published a year apart by the crypto venture shop Lattice gives insight into how the year SOL cratered to $9 specifically affected Solana-based startups. Lattice published a 2021 seed round retrospective in 2023, and a 2022 retrospective recently in 2024. 

26%, or more than a quarter, of 2022 Solana seed startups have already failed, and only 61% have managed to ship a product, according to Lattice. Among crypto ecosystems, only Binance saw a lower percentage of projects shipping products. Binance, Avalanche and NEAR 2022 startups all topped Solana’s fail rate, too. 

Still, it was a marked step down from 2021’s cohort of Solana startups. In Lattice’s retrospective on that year, published in 2023, it found that 75% of 2021 Solana startups had already shipped a product, and only 11% had failed. Both figures are markedly better compared to 2022.

Meta, the pseudonymous co-founder of Solana-focused Lucid Ventures, said they don’t think Solana is “abnormal” in the VC world, where it’s “standard” for many projects to fail. 

In Solana’s early days, a lot of projects garnered visibility from hackathons organized by the network — the sizable liquid staking protocol Marinade was started as a Solana hackathon project, for instance. This can gin up developer excitement, and other alternative blockchains are trying to recapture some of the same magic, it seems: Monad just held a pitch competition for the yet-unlaunched chain. But early, hackathon-era projects may not have a very high success rate.

SOL Big Brain, another pseudonymous VC, posted a list of projects they had been told to keep an eye on in 2021. Very few still garner any name recognition.

“Lessons in there for investors investing in new ecosystems,” they wrote. 

Of the Solana startups that did survive 2022, however, some are now in the process of raising follow-on funding, and these bigger rounds are starting to touch down. Notably, Drift and Helius both announced rounds in excess of $20 million last month. By my count, this represented the largest Solana rounds in this market cycle for startups that aren’t aiming to build their own blockchains.

These rounds contributed to the $173 million in venture funding the Solana ecosystem hauled in in Q3 of this year, its highest quarterly total since Q2 of 2022, according to the Solana Foundation.

But while Solana may be once again putting up 2022 venture numbers, it will hope to avoid 2022 venture outcomes.

Permissionless has the galaxy brain content you read the Lightspeed newsletter for, but IRL. 

Catch the brightest minds in the Solana ecosystem as they discuss the challenges and future of blockbuilding in Solana.

It appears that Ondo just tokenized a whole bunch of assets on Solana. 

The amount of tokenized US Treasurys, bonds and cash-equivalents on Solana had remained around $60 million since April, according to rwa.xyz. But that figure suddenly doubled to over $120 million during the last few days of September.

It looks like this sudden jump came mostly from Ondo’s USDY — basically a tokenized Treasury equivalent — being minted on Solana. It’s not clear to me who was behind the assets being minted.

A message from Jeffrey Albus, writer/editor for Lightspeed: